Asia Bond Monitor September 2011

"The size of local currency bond markets in emerging East Asia continued to expand in the first half of this year, rising to USD5.5 trillion at the end of June, 2.4% higher in local currency terms than at the end of March, and 7.7% more than at the end of June 2010. The overall emerging East Asian market's growth was driven by corporate bonds, which grew by 4.4% quarter-on-quarter. The PRC's corporate bond market grew at a more rapid pace of 6.3% in the same period and is now the region's largest corporate bond market."

Read the full report - http://asianbondsonline.adb.org/documents/abm_sep_2011.pdf?src=newsletter&id=Vd7k9wdkOhnXujvrtQLVzHQl3Ygf9j

Read the news release - http://asianbondsonline.adb.org/documents/abm_news_release_sep_2011.pdf?src=newsletter&id=Vd7k9wdkOhnXujvrtQLVzHQl3Ygf9j

Read past issues - http://asianbondsonline.adb.org/regional/abm.php?src=newsletter&id=Vd7k9wdkOhnXujvrtQLVzHQl3Ygf9j

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For comments and suggestions on our website, please contact us at asianbonds_feedback@adb.org

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AsianBondsOnline is an ASEAN+3 initiative, supported by the Asian Development Bank and funded by the Government of Japan. It offers easy, centralized access to information about the region's rapidly developing bond markets. The website contains essential data on current market activities, the legal and regulatory framework of each market, and monitors government policies and initiatives affecting the industry.

It covers the 13 markets listed above and the Asian regional market. The Office of Regional Economic Integration of the Asian Development Bank developed and maintains AsianBondsOnline.

How an Analyst can interpret the Data

Cheers : Follow the Picture

Efficient market Hypothesis: Zero hedge

Since this chart from the WSJ sums up petty much everything about the "efficient market hypothesis" or whatever it is those wacky Chicago PhD's call their multi-variable, self-similar, Lorenzian "strange attractor" equations that describe human irrationality to the dot, there is little need for commentary : Zero Hedge 

Full article at
http://www.zerohedge.com/news/charting-latest-iteration-moral-hazard

Picture from WSJ attached.

AsianBondsOnline Newsletter (29 August 2011)

To read the full report, data and graphs go to http://www.asianbondsonline.adb.org/newsletters/abowdh20110829.pdf?src=wdh&id=Vd7k9wdkOhnXujvrtQLVzHQl3Ygf9j

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News Highlights - Week of 22 - 26 August 2011

Consumer price inflation in Hong Kong, China quickened to 7.9% year-on-year (y-o-y) in July due to increasing food prices and a low base effect resulting from the timing difference of government's public housing relief measures. Japan's core consumer price index rose slightly in July to 0.1% y-o-y as energy prices increased. Singapore's consumer price inflation accelerated to 5.4% y-o-y in July from 5.2% in June on the back of higher costs for transportation, accommodation, and food. Consumer price inflation in Viet Nam rose to its highest level since December 2008, reaching 23.1% y-o-y in August from 22.2% in July as costs for food surged.

*The Bank of Thailand last week raised its 1-day repurchase rate by another 25 basis points to 3.5%. This was the sixth consecutive rate hike since January. Heightened concerns over inflation outweighed the risks to growth as domestic consumption and investment are expected to remain robust.

*Moody's Investors Service lowered Japan's credit rating to Aa3 from Aa2. The outlook on the ratings is stable. Standard and Poor's affirmed its AAA sovereign credit rating and stable outlook for the Singapore government's long-term debt.

*On 24 August, the Japan Credit Rating Agency (JCR) affirmed Indonesia's ratings for long-term FCY and LCY senior debt at BBB- and BBB, respectively. The outlook for both ratings was stable.

*The People's Bank of China (PBOC) announced the expansion of the existing cross-border trade renminbi settlement program to include the entire country. During the first half of the year, the People's Republic of China's (PRC) total renminbi settlement in cross-border trade increased 13.3 times to reach RMB957.6 billion.

*The Republic of Korea's external debt position rose to USD398.0 billion in June. The country's outstanding household loans grew 8.7% y-o-y in July to reach KRW826 trillion. Finally, the credit default swap (CDS) spread for 5-year FCY-denominated government bonds widened to 149.2 basis points. LCY corporate bond issuance in the Republic of Korea was down 29.5% month-on-month (m-o-m) to KRW8.1 trillion in July. However, the cumulative corporate bond issuance over the January-July period stood at KRW75.1 trillion, which was up 9.3% y-o-y.

*Last week, KT Corporation of the Republic of Korea raised KRW600 billion from a triple-tranche bond sale. In Malaysia, YTL Power International sold MYR2.2 billion worth of 7-year notes with a coupon of 4.35%. In the Philippines, United Coconut Planters Bank issued PHP3.15 billion of LTNCD (long-term negotiable certificates of time deposit), which carry a coupon of 6.0% (payable quarterly) and have a maturity of 5 years and 3 months. Thai property developer Quality Houses raised a total of THB3 billion in bonds. Meanwhile, the State Railway of Thailand issued THB1 billion of 12-year bonds at a coupon of 3.99%.

*Government bond yields fell last week for most tenors in Indonesia, Malaysia, and the Philippines, while yields rose for all tenors in Viet Nam and for most tenors in Hong Kong, China; and Singapore. Yield movements were mixed in the PRC, the Republic of Korea and Thailand. Yield spreads between 2- and 10- year maturities widened in Hong Kong, China; the Republic of Korea; Malaysia; the Philippines; Singapore; and Viet Nam, while spreads narrowed in the rest of emerging East Asian markets.

*WHAT'S NEW: The next edition of the Asia Bond Monitor will be launched on 1 September.